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India Office Absorption Rises 26 Per Cent in Q3
Real Estate

India Office Absorption Rises 26 Per Cent in Q3

India's office sector recorded net absorption of 14.1 mn square feet (MSF) across the top eight cities in Q3 2026, up 26 per cent quarter-on-quarter, according to Cushman & Wakefield's Q3 2026 Office MarketBeat report. Gross leasing volume (GLV) reached 21.9 MSF, an increase of 3 per cent from the previous quarter, while leasing in the first nine months stood at 64.6 MSF, the highest for that period.

Fresh leasing represented about 75 per cent of year-to-date activity, while pre-commitments rose to around 12 per cent as occupiers sought to secure quality space before projects were completed. Hyderabad led net absorption at 4.1 MSF, followed by Bengaluru at 4.02 MSF, Delhi NCR at 2.2 MSF and Mumbai at 1 MSF. Bengaluru led GLV at 5.2 MSF, ahead of Hyderabad at 4.2 MSF, Mumbai at 3.9 MSF and Delhi NCR at 3.8 MSF.

New office completions reached a quarterly record of 22.7 MSF, nearly twice the previous quarter's level. Bengaluru accounted for 43 per cent of additions and Hyderabad for 38 per cent, together contributing more than four-fifths of new supply. Year-to-date supply reached 43.3 MSF, equivalent to 82 per cent of the supply added throughout 2025, placing 2026 on course to set a new annual record. Vacancy rose 63 basis points quarter-on-quarter to 14.37 per cent, the first increase after 12 consecutive quarters of decline.

Despite higher vacancy, office rents increased 2 per cent quarter-on-quarter across most major markets. Global Capability Centres (GCCs) leased 9.1 MSF in Q3, accounting for 42 per cent of GLV. Year-to-date GCC leasing reached 25.3 MSF, or 39 per cent of total leasing, with Bengaluru, Chennai and Pune recording particularly strong activity. In Bengaluru and Pune, GCCs represented about 65 per cent of leasing.

Banking, financial services and insurance (BFSI) was the largest sectoral demand driver, accounting for 24 per cent of Q3 leasing, followed by IT-BPM at 22 per cent. BFSI leasing reached 13.2 MSF year-to-date, up 34 per cent year-on-year, while IT-BPM occupiers leased about 14 MSF. Engineering and manufacturing recorded 10.2 MSF of year-to-date leasing. Flexible workspace operators leased 3.5 MSF in Q3 and 11.9 MSF in the first nine months, a 42 per cent annual increase and 18 per cent of total leasing.

India's office sector recorded net absorption of 14.1 mn square feet (MSF) across the top eight cities in Q3 2026, up 26 per cent quarter-on-quarter, according to Cushman & Wakefield's Q3 2026 Office MarketBeat report. Gross leasing volume (GLV) reached 21.9 MSF, an increase of 3 per cent from the previous quarter, while leasing in the first nine months stood at 64.6 MSF, the highest for that period. Fresh leasing represented about 75 per cent of year-to-date activity, while pre-commitments rose to around 12 per cent as occupiers sought to secure quality space before projects were completed. Hyderabad led net absorption at 4.1 MSF, followed by Bengaluru at 4.02 MSF, Delhi NCR at 2.2 MSF and Mumbai at 1 MSF. Bengaluru led GLV at 5.2 MSF, ahead of Hyderabad at 4.2 MSF, Mumbai at 3.9 MSF and Delhi NCR at 3.8 MSF. New office completions reached a quarterly record of 22.7 MSF, nearly twice the previous quarter's level. Bengaluru accounted for 43 per cent of additions and Hyderabad for 38 per cent, together contributing more than four-fifths of new supply. Year-to-date supply reached 43.3 MSF, equivalent to 82 per cent of the supply added throughout 2025, placing 2026 on course to set a new annual record. Vacancy rose 63 basis points quarter-on-quarter to 14.37 per cent, the first increase after 12 consecutive quarters of decline. Despite higher vacancy, office rents increased 2 per cent quarter-on-quarter across most major markets. Global Capability Centres (GCCs) leased 9.1 MSF in Q3, accounting for 42 per cent of GLV. Year-to-date GCC leasing reached 25.3 MSF, or 39 per cent of total leasing, with Bengaluru, Chennai and Pune recording particularly strong activity. In Bengaluru and Pune, GCCs represented about 65 per cent of leasing. Banking, financial services and insurance (BFSI) was the largest sectoral demand driver, accounting for 24 per cent of Q3 leasing, followed by IT-BPM at 22 per cent. BFSI leasing reached 13.2 MSF year-to-date, up 34 per cent year-on-year, while IT-BPM occupiers leased about 14 MSF. Engineering and manufacturing recorded 10.2 MSF of year-to-date leasing. Flexible workspace operators leased 3.5 MSF in Q3 and 11.9 MSF in the first nine months, a 42 per cent annual increase and 18 per cent of total leasing.

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